Most of us feel deeply about our right to free speech.
It is a right we are born with, one the government cannot take away. But it took an-out-of-control Supreme Court in the Citizens United case to decide that the right to free speech not only applies to individuals but also to corporations. Therefore, Congress cannot restrict the ability of corporations to contribute to political campaigns because doing so would be restricting free speech.
The basic problem with the court’s argument is that the government creates corporations. They are not natural occurring entities, like human beings.
The government created corporations to promote economic growth. Because the government grants corporations limited liability, it is much easier for corporations to raise capital than it is for individuals acting without corporate status. As a result of this setup, a corporation can tell people buying its stock they are only risking the money they spend on the stock.
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So, if I buy 100 shares of a company’s stock, and the firm falls into bankruptcy because business turns bad or the corporation somehow harms its workers, customers, or neighbors, I don’t have to worry about losing my house and my bank account. I can only lose what I paid for my stock.
This would not be true if I bought into a partnership, where I would be personally responsible for any liabilities it incurred.
For this reason, corporate status is a great privilege that the government makes available in order to make it easier to raise capital.
Having decided to grant this privilege to corporations, it seems more than a bit absurd to argue, as was done in Citizens United, that the government can’t set rules restricting the actions of corporations it has created.
This was exactly the logic expressed by a famous Supreme Court justice in a similar case in 1978. The famous justice was William Rehnquist, who was appointed to the court by Richard Nixon. He was later elevated to Chief Justice by Ronald Reagan.
Rehnquist is almost universally considered a very conservative justice. He didn’t argue against free speech rights for corporations based on radical anti-corporate sentiment. He argued based on common sense.
If the speech of corporations is restricted, no person in the world is being prevented from speaking freely.
Of course, corporations have shareholders and also workers, all of whom have the right to say whatever they want and support whatever candidate or political cause they want. The only issue is whether they can use a for-profit corporation to carry out their speech.
Unfortunately, even if Citizens United is overturned, which it should be, restricting corporate speech will not do much to redress the incredible imbalance in our political system, where billionaires’ views matter way more than those of everyone else.
No one turns to Mark Cuban or Mark Zuckerberg for great ideas about how to run the country. These people are courted by politicians because of their ability to raise money for them.
The rich also have special access to the media and to those who own it, like Rupert Murdoch.
Reversing Citizens United won’t end the disproportionate political power of the rich. That will require measures to amplify the voices of ordinary people, such as public financing that multiplies small campaign contributions. New York City has led the way.
But it is an important first step to recognize that corporations were created by the government to increase wealth. They don’t exist to tell us what sort of government we should have. For this reason, reversing Citizen’s United is a step in the right direction.
Dean Baker is a macroeconomist and co-founder of the Center for Economic Policy and Research in Washington, D.C.